Forest Hill's Jeff Judge in Financial Planning: A new "fiduciary" definition won't clear things up

By Jeff Judge, CFP®, AEP®, ChFC®, CLU®, Managing Partner, Chesapeake Financial Planners, Forest Hill, MD.

A client recently came to me after leaving a brokerage firm because she wanted fiduciary advice. One of the first things we did was spend half an hour just untangling what "fee-only" and "fee-based" mean. That is how confusing this has gotten for regular people.

So when Financial Planning asked me about NAPFA's new definition of "fiduciary" this week, my honest reaction was that it will not make that conversation any shorter.

Here is the distinction I think matters. The SEC already has a fiduciary standard. It is not perfect, but it asks the right question: did you act in the client's best interest? That question is auditable, enforceable, and meaningful. NAPFA is answering a different question, which is what an advisor is allowed to charge. That is a compensation philosophy. It is worth knowing, but it is not the same thing as being held to your best interest.

For families here in Harford County, the practical takeaway is simple. Do not stop at the word "fiduciary." Ask any advisor to show you, in writing, how they are paid and why a specific recommendation is in your interest. A clear answer tells you most of what you need to know, no matter which label is on the door.

This piece builds on "Does NAPFA's new fiduciary definition clarify or muddy the water for clients?," published in Financial Planning (June 2026): https://www.financial-planning.com/news/does-napfas-new-fiduciary-definition-clarify-or-muddy-the-water-for-clients

Jeff Judge, CFP®, AEP®, ChFC®, CLU®, is Managing Partner at Chesapeake Financial Planners in Forest Hill, MD. Book an intro call.